Donations Are Down Entering The Season Of Giving
Wednesday, November 26, 2008SUZANNE PRATT: With the holiday season kicking off tomorrow, charitable giving comes into focus for many people. But as Jeff Yastine reports, in this year of economic turmoil with bailouts and bankruptcies, charities are worried the public won't be in a giving mood.
JEFF YASTINE, NIGHTLY BUSINESS REPORT CORRESPONDENT: At holiday food giveaways like this one, you see the economy's story etched on their faces. Some people have lost jobs. Others, like Maddie Lane, find a Social Security check only stretches so far and she's not waiting until Thanksgiving to eat her free turkey.
MADDIE LANE, FORT LAUDERDALE, FL: When you get your Social Security check and you don't have any food, you got to use some of that to get a little something to eat. And then you can't pay your bills. A Social Security check is not that much.
YASTINE: Have you gone without eating?
LANE: Yes, I have a lot of times.
YASTINE: But charities that typically offer help are being squeezed as never before.
BRUCE HARRIS, DIR. OF DEVELOPMENT, THE PANTRY OF BROWARD CO.: This is where we have the boxes lined up for Thanksgiving food. The corn, the beans, the onion rings, the pumpkin pie, et cetera, et cetera.
YASTINE: Bruce Harris sees it at the Pantry of Broward, a south Florida food bank. Food donations are coming in, but not as much as he expects during the holidays.
HARRIS: This will give you an idea here. We were hoping at this time of year, to be up at 16,000 pounds.
YASTINE: This is how much you've raised so far in terms of tonnage of food?
HARRIS: In general giving this year is way down from previous years. Part of it I think is the psyche that in general the public is in. This rollercoaster ride where our nest eggs have been turned into fried eggs. We don't know what's coming and so people are pulling back.
YASTINE: Most charities take in about a quarter of their annual donations during the holidays. So shortfalls impact any organization's yearly goals. One recent study found that during recessions, giving fell about 1 percent when adjusted for inflation. And if there were eight months or more of recession in a calendar year, then giving fell about 2.7 percent. Nadia Scales-Blue doesn't need a study to see that giving is slowing. She sings a little and rings her bell a lot next.
NADIA SCALES-BLUE, BELL RINGER, THE SALVATION ARMY: I'm addicted to my bell. You can tell that it's hard on them to donate and they'll stand next to the bucket for a while sometimes and count out their pennies and their change.
YASTINE: It's not just that donations are down. Many charities like the Salvation Army also have endowments which help to support their operations. And those endowments are usually heavily exposed to the stock market. Area Salvation Army commanders like Tom Louden say that translates to losses of 20 to 30 percent.
TOM LOUDEN, AREA COMMANDER, THE SALVATION ARMY: The endowments have really served to bridge the gap in past times when needs have increased and the stock market has been strong, we could depend on that type of income. But now that income has basically disappeared for us for the foreseeable future.
YASTINE: Which makes the job of charities that much tougher. More people looking for help and less money around to provide it. Jeff Yastine, NIGHTLY BUSINESS REPORT, Fort Lauderdale.
